Kids, Debit Cards and BuxBoxes -- 0932-06 ZZfwi

         TO:   All Interested Onliners                                                                                         FROM: Jim Bramer. Retired Auditor-CPA
                                                                                                                                                      FILE: 0932-06/fwi

          RE:  Kids, Money & their use of Internet & Plastic                                                Originated in February 2006

    "Today's "Ax to Grind"   

        The use of  Plastic (Credit/Debit Cards) is a part of today's society .... rather than not use Plastic (you know, the evil debit and credit cards, etc.) as some advocate,  I believe the solution is to early in our lives learn how to righteously handle such very helpful resources.  I believe it is helpful to begin Plastic use by kids with Prepaid  "Debit Cards" -- and not "Credit Cards"  whereby money, of course,  is borrowed.   High School/College age kids these days are VERY computer/Internet savvy  (if some of us have a problem with our computer -- we go to the kids, right!!!. ) but they also need to be properly attuned to its use with respect to handling money properly. Accentuate the positive .. not the negative ....and have them learn to handle money utilizing these Plastic tools.

        Accordingly, they need to live within financial boundaries - as this applies during their entire life time. Or they learn to spend only what they have (usually the periodic allowances provided by Dad/Mom) as they no longer are always asking Dad/Mom for green stuff, or  money, etc. Plus they are not carrying too much cash around that is not easy to track and can get lost or simply disappears.

        When you go to http://www.allowcard.com  you will learn about what is sometimes called  "Prepaid 'Allowance' Debit Cards."  I am convinced such an effort can function like the use of  Quite Virtual Envelopes  (also referenced as the eEnvelope system) or a BuxBox effort that we reference at  0002  where we push the use of BuxBoxes in the setting of a financially struggling Ministry.  But the BuxBox concept is just as doable for the "Kids, Money & their use of Internet & Plastic"  kind of circumstances.  Or this would apply to kids who are trained and required (if no BuxBox effort then no next weekly allowance, etc.) to spend only what is left in a certain BuxBox. 

        BASIC:   Kids and everyone else ABSOLUTELY MUST diligently keep money records - everyone MUST meaningfully know where they are financially!!!!  And ABSOLUTELY NO CREDIT CARD Debt --- initially pay off Credit Card balance weekly, etc.

        Please consider these features:

    >> The allowance amount within this Prepaid Card could be viewed like just one big BuxBox that they must monitor each week via their computer/Internet so they know how much is yet available. In their use of this Prepaid plastic, they weekly go to www.allowcard.com  and observe how they have already spent their money. Sometimes they will want a hard copy of this information.

    >> Or they may want the  Prepaid Card Balance to be divided up into different "types of spending group" BuxBoxes (hopefully no more than three) which they update weekly and know if they are staying within their overall BuxBox balance spending limits, etc. Usually they have a columnar sheet of paper for each BuxBox where they are expected to manually post their paid outs. They learn to manually compute the new BuxBox balance and they make sure the individual BuxBox balances agree with the Prepaid Card Balance total. They are required to have this BuxBox status information with their green stuff so they can appropriately spend via the Prepaid Card during the following week.

    >> Here is also an opportunity to teach your kids to make/keep financial commitments to their Church.  Some Churches allow you to make Online Donation Payments and your kids should be encouraged to use this part of the Internet.

    >> Another significant issue is for the kids to save money for future spending  that is important to them (like their own vehicle). Often this money goes into a "SetASide for the Future" Savings Bank account that is also Online accessible. Perhaps transfers can be made from their Prepaid Allowance Debit Card account to this Online Savings account.

    >> Seems that the above would mostly apply to High School/College kids. Younger kids need to learn to control the cash (Green stuff/Coins) that they have in their possession. Perhaps with a BuxBox like approach whereby they should place the Green Stuff/Coins in various physical Bux/Box/Envelopes as, at an early age, they understand the discipline of staying within buying limits within certain areas of life.

    >> Kids, like many of us these days, get gifts via Vendor's Gift Cards in the form of plastic Prepaid Debit Cards. Generally. they spend such money as they see fit and seldom would they want BuxBox limits that we are discussing here. Sometimes it can be arranged for such Gift Card money to go into this "Setaside for the Future" Savings Account.

K E E P   L O O K I N G   U P !!

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    UPTD: March 04, 2009 

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